Paying student athletes will not ward off corruption
To the Daily:
After reading Jeremy Lacks’ viewpoint NCAA exploitation must end to clean up hoops (11/18/02), I felt appalled at his suggestions. He argues that the NCAA is an evil organization that uses athletes to make massive profits for itself. He further states that these same athletes get few benefits from the NCAA and member schools.This is wrong.
The NCAA is in a sense a non-profit organization. Lacks writes that the NCAA makes huge profits from the deal with CBS that pays out “a whopping $6 billion over the next 11 years,” and from that infers the NCAA is making huge profits. According to the NCAA budget for this next year (www.ncaa.org), the NCAA will receive $422 million in revenues. Total expenses come to $419 million. The remainder is set aside for future expenditures. And remember, we are looking at budget, and for the most part, revenue will be lower and expenses will be higher than budgeted.
So I hardly see “enormous profits” that Lacks is dreaming of. I guess if you consider the $3 million (probably less) that the NCAA is putting in funds that go towards student athletes as profits, then yes they made some profits. Where is all the money the NCAA is getting going? Over 58 percent ($245 million) of revenues are going towards student athletes in Division 1.
In essence, this is where the athletes’ scholarships, stipends and special programs come from. According to the NCAA website: “Athletic scholarships for undergraduate student-athletes at Division I and Division II schools are funded through the NCAA membership revenue distribution. These scholarships are administered directly by each academic institution and not the NCAA.” So that means Michigan is not paying anything for athletic scholarships. Wrong. As any econ student would know, there is an opportunity cost involved. The University could have accepted the application of a paying student instead of the student athlete, which means the school loses out on around 15-30 grand in revenues per scholarship athlete. Lacks suggests that the NCAA should pay out “a standard wage” to student athletes. Where will this money come from? As we saw above, the NCAA only has around $3 million to pay this wage. Again from the website, the NCAA finds that there are approximately 150,000 athletes in Division 1. Do some simple math: 3 million/150,000 comes out to $20 per athlete. Wow, that’s a tidy sum.
How about we just give those with professional career aspirations: football and basketball. Let’s say we somehow find the money to give these athletes $10,000 extra per year. Will this actually do anything to prevent taking money from boosters or jumping to the NBA? Let’s see, should I take 10 grand a year or the multi-million dollar contract. Yeah that’s an easy choice. The difference between 10 grand and zero is negligible when compared to millions of dollars.
Lacks makes some interesting points, but in the real world wouldn’t work. College athletics can only change if the professional leagues change as well. Until that day comes, it will be business as usual: fat wads of cash and the NCAA and universities looking the other way.